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What Economic Tools Do We Remember?? Flashcards | StudBud
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What Economic Tools Do We Remember??
What Economic Tools Do We Remember??
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Answers
1
Given the following data, it is clear that this market is
Oligopoly
Perfect Competition
Monopolistic
Monopoly
2
Which of the following price ceilings would be binding in this market?
$6
$5
$7
$4
3
Any point on a country's production possibilities frontier represents a combination of two goods that an economy
can produce using all available resources and technology.
may be able to produce in the future with more resources
will never be able to produce.
can produce using some portion of its resources and technology.
4
Elasticity is defined as
The percent change of Price divided by the percent change in Quantity
The percent change in Cost divided by the percent change in Profit
The percent change in Profit divided by the percent change in Cost
The percent change in Quantity divided by the percent change in Price
5
For Utility Maximization Theory you are given: U = 5B
.5
K
.5
and 500 = 4B + 7K What is the marginal utility of K?
2.5B.5K-.5
5BK
2.5B.5K.5
2.5B-.5K.5
6
Brad produces 6 Wheat or 12 Beef; Theresa produces 2 Wheat or 10 Beef. Brad has a comparative advantage in...
neither wheat or beef
both wheat and beef
beef
wheat
7
In the short run, a firm operating in a monopolistically competitive market can earn
economic losses
all of the above
zero economic profits
postive economic profits
8
At the equilibrium price, producer surplus is
$1,750
$2,500
$3,500
$5,000
9
Excess Supply exists
At the Choke Price
Above Equilibrium
At Equilibrium
Below Equilibrium
10
Which of the following would have the FLATTEST demand curve??
elasticity of demand = 0.55
elasticity of demand = 1.58
elasticity of demand = 0.22
elasticity of demand = 3.77
11
Which of the following will shift the demand curve to the right of an inferior good?
An increase in the income level of consumers
An increase in the population of the city
An increase in the price of resources
A decrease in the income level of consumers
12
What is the profit maximizing level of output for this firm?
8 units
5 units
7 units
6 units
13
For Utility Maximization Theory you are given: U = 5B
.5
K
.5
and 500 = 4B + 7K What is income?
4
7
500
5BK
14
Which of the following is
not
a characteristic of a perfectly competitive market?
Firms are price takers
Firms have difficulty entering the market
Many sellers
Prices of goods sold are the same
15
Which of the following areas represents the profit earned by this monopolist?
BCFE
CFIH
EFG
ABE
16
As you add more of a variable input to a fixed input evenually productivity declines IS
Diminishing Marginal Rates of Substitution
Decreasing Returns to Scale
Resources Allocative Efficiency
The Law of Diminishing Returns
17
Brad produces 6 Wheat or 12 Beef; Theresa produces 2 Wheat or 10 Beef; Theresa has Absolute Advantage in...
neither wheat or beef
wheat and beef
wheat
beef
18
A relatively steep demand curve indicates that
quantity demanded will adjust only slightly to a price change.
quantity demanded will adjust significantly to a price change.
quantity demanded will not adjust to a price change.
the change in quantity demanded will exactly equal a change in price.
19
What is the marginal product of the second worker?
15 students
22.5 students
25 students
20 students
20
What price will a profit maximizing monopolist charge?
P3
P2
P4
P1
